Global oil production up with a rise in non-Opec output
Production increased to 92.6 million barrels a day, boosted by non-Opec output
Global crude production increased by 530,000 barrels per day (b/d) in May, to 92.6 million b/d, driven by a boost in non-Opec output.
Non-Opec production reached 56.22m b/d in May, according to International Energy Agency (IEA) data, a rise of around 440,000 b/d. The increase, of about 1m b/d year-on-year, largely offset declines in Opec's output. Opec production inched up by 85,000 b/d in May, to 29.99m b/d, as gains from Saudi Arabia offset output losses from Libya.
In Iraq and Libya, production fell below 100,000 b/d in early June, down from an average of 1.4m b/d a year ago. This has renewed focus on Saudi Arabia to boost its oil output or release some of its stocks. The IEA estimates Saudi Arabia holds 80% of Opec's 3.31m b/d of spare capacity.
The agency increased its call on Opec crude and stock change by 150,000 b/d for the second half of 2014, to 30.9m b/d.
In its Medium-Term Oil Market Report, the IEA said Opec's conventional oil production will remain at risk over the next five years if violence and political instability in Iraq persist.
The IEA forecasts Opec's production capacity will increase by around 2.08 million b/d between 2013 and 2019. Around 60% of this growth is expected to come from Iraq. However, the country's precarious political and security situation poses a serious risk to its medium-term production targets, while recovery in Libya looks increasingly unlikely in the short term. It added that Opec members have failed to attract enough investment to develop ageing oilfields, which casts doubt on the organisation's supply growth prospects.
OECD industry crude stocks increased by 39.8m barrels in April, twice the seasonal average, to around 2.6bn barrels. Initial IEA data indicate there was a further 37.4m barrel build in May.